Oil prices found some respite on Wednesday as U.S. oil futures rose more than 20% and Brent prices steadied after a two-day price plunge, as markets struggle with a massive crude glut amid the coronavirus outbreak.
After falling into negative territory for the first time in history amid record trading volumes, U.S. crude futures rose 20% as contracts for May delivery expired and the June contract became the front month.
West Texas Intermediate was up $2.05, or 18%, at $13.62 a barrel by 0034 GMT.
Brent crude, which settled down 24% in the previous session, was up 4 cents at $19.37 a barrel after rising more than $1 earlier.
“Global markets are struggling mightily with a temporary but overwhelming demand drop due to the coronavirus pandemic,” said Stephen Innes, global markets strategist at AxiCorp, warning that prices could tumble further as storage fills up.
Oil prices have slumped over 70% this year as the coronavirus has slashed demand for everything from jet fuel to gasoline, while storage tanks around the globe are filling rapidly.
The volatity in the oil market has prompted CME Group, the world’s biggest commodities exchange, to raise margins on crude oil futures.
Giving some support to prices, the U.S. Senate on Tuesday approved nearly $500 billion in added support for the U.S. economy and hospitals and will send the measure to the House of Representatives for final passage later this week.